By Gordon Garnos
AT ISSUE: Once again, my apologies to Mr. Shakespeare for today's headline, but that seems to be the message these days in Pierre. Several big tax issues are somewhere between the drawing board and the Governor's signature.
Currently, several of them are firmly set in Jello. The thing to remember about legislative issues concerning both tax bills and those that may do away with one tax or another "it ain't over till' the fat lady sings" and that won't be until March 17, better known as Veto Day.
THIS IS THE FIFTH legislative week during the 83rd Legislative session in Pierre. A couple of big dates during this session are already history. Jan.
23 was the final day to introduce individual bills and joint resolutions and Jan. 24 was the final day to introduce committee bills and joint resolutions. I mention this because while these bills are somewhere in the process, the decisions now are whether they live or die. And don't forget, with amendments, smoke outs, etc., there is going to be a lot of wood put on the fire before the final day.
Of course, leading the pack, as usual, are tax bills and whether or not there is going to be enough money for everything.
At this point, I would have to say, changing or not changing the property tax system in South Dakota is significant to all of us who own property, especially the farmers in the state. Property tax is based on the value of your buildings or land. Simple. Whoa, not so simple. Since 1999 the law removes any property, buildings or land, that sells for more than 150 percent of its assessed value. The tool assessors use for determining the value of these is the value of similar land or buildings nearby. In other words, what was the last price they sold for.
IF A PIECE OF LAND sold for more than 150 percent of the recent land sales in the neighborhood, that value was thrown out of their calculations for the assessed value. There have been a number of land sales over the past few years that sold for several times the assessed value of that land. So, the question is: Should that land value be assessed for its true value or on what that land produces? There is doubt out there that this won't be changed this year because of the diversity of land values in South Dakota. In a way, this pits West River against East River.
Another issue that could gain steam is whether or not South Dakota's liquor laws will be changed. Today, the number of liquor licenses a county or a town can have is based on population. Most larger cities are at their maximum for licenses issued and more are needed municipal officials are saying. They say any new licenses would be just for restaurants, sort of an economic development thing.
If something comes out of this, current license holders say, they should be compensated for the licenses they paid big bucks for and theirs will then go down in value.
I HAVE A REAL problem with this. These local license holders would have to get their compensation from the state or the city where they are located.
The state isn't going to do it and, for sure, no city in South Dakota could afford to pay this compensation.
Bear this in mind, those business people holding liquor licenses belong to one of the most powerful lobbies in Pierre and if they said they should be compensated, that's it, even if it is ridiculous.
A letter writer put it this way, "A liquor license is a product like any other priced item. There are fluctuations in supply and demand, and when this happens, the price will move up or down accordingly. If I buy something today and the price goes down tomorrow, I am not going to get a refund for the drop in price." It is pretty hard to argue with that kind of logic.
THE BIOFUEL TAX break Governor Rounds asked for apparently now is a done deal. That takes two cents off the price of this product, very much like what ethanol enjoys. So while he claims the state's finances aren't what they should be, it is felt that with this tax break it will be enough incentive to further the market for this fuel. Seems logical.
Another incentive going through the legislative halls in Pierre could help construct badly needed electric transmission lines from South Dakota's new wind energy industry to where this power is needed. As you know, lack of transmission lines is the main thing holding back this industry. Both this industry and the ethanol industry are extremely important to South Dakota's future.
These and other important bills regarding taxation are making their way through the process. At this point it is difficult to say which ones will be the survivors. With this goes the question, where is the money going to come from to pay for all the demands placed on South Dakota's government? Another question, is our traditional forms of taxation going to be able to carry the ball for our state's future needs?....
Gordon Garnos was long-time editor of the Watertown Public Opinion and recently retired after 39 years with that newspaper. Garnos, a lifelong resident of South Dakota except for his military service in the U.S. Air Force, was born and raised in Presho.
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Monday, February 04, 2008
Tax or no tax, that is the question in Pierre these days
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